Speaker 1: From the heart of where innovation, money and power collive
Speaker 1: in Silicon Valley and beyond. This is Bloomberg Technology with
Speaker 1: Emily Jay. I'm Emily Changing in San Francisco, and this
Speaker 1: is Bloomberg Technology coming up in the next hour of
Speaker 1: robust US labor market spells bad news for financial markets.
Speaker 1: Today's jobs report sent shares tumbling as investors predict more
Speaker 1: rate hikes. We're going to talk about why tech is
Speaker 1: in a particularly tough position plush. Chipmakers warn of a
Speaker 1: major industry slowdown, sending tech shares even though we're the
Speaker 1: biggest names from a m D to Samsung and Micron
Speaker 1: are all saying the same thing. Demand is tumbling. Gonna
Speaker 1: have more on that in a moment. And Facebook is
Speaker 1: sending its own warning to users you may have been hacked.
Speaker 1: Meta says one million user logins may have instolen compromised.
Speaker 1: Later this hour, we're gonna talk to Meta security policy director.
Speaker 1: Chip makers warning weekly that demand is faltering, this as
Speaker 1: they face surging shipping and materials costs, and in the
Speaker 1: latest sign of trouble, Samsung and a m D reporting
Speaker 1: these disappointing results. Bloomberg's Ian King, our residentship expert with US. Now,
Speaker 1: So Ian didn't we know demand was bad? Why are
Speaker 1: we seeing such a strong reaction here? Absolutely? Right. We've
Speaker 1: had companies going out there for a while and I
Speaker 1: was saying, yeah, things things are getting bad. We've got
Speaker 1: a lot of infantry. What happened yesterday provoked unless to
Speaker 1: be writing with thoughts with expletives in the headlines. I mean,
Speaker 1: it was really bad for ame d and ED actually
Speaker 1: sold something a bit short. Yes, it's the biggest memoryship maker,
Speaker 1: but it's also the world's biggest hip maker. Company like
Speaker 1: that comes out and says, yeah, things are actually bad.
Speaker 1: It's it's not just bad, but it's way worse than
Speaker 1: we thought. So that's kind of recalibrating people's expectations. They're
Speaker 1: no longer just looking for the bottom. They're back to
Speaker 1: worrying about how about get it meantime, and you've got
Speaker 1: the White House adding new restrictions on China's access to
Speaker 1: US chip technology. Is that making things worse here? Absolutely?
Speaker 1: That's a that's an ongoing concern because this isn't just
Speaker 1: one isolated incident. This is like an incremental set of
Speaker 1: increases of intensification in this dispute between the world's two
Speaker 1: largest economies. And you know, if you're an investor out there,
Speaker 1: you're thinking, well, what's going to happen next? And the
Speaker 1: trend within these you know, so called security related national
Speaker 1: security related measures is to intensify, is to broaden them,
Speaker 1: and that's going to place greater restrictions on chipmakers that
Speaker 1: want to do business in China. Talk to us a
Speaker 1: little bit more about what's behind these new rules from
Speaker 1: Washington and how you expect these two evolve. Well, just
Speaker 1: to give you an example, we had a story out
Speaker 1: earlier this week which had that Huawei, which is a
Speaker 1: company that we know, a Chinese company that's been on
Speaker 1: this sort of entity list in the US for a
Speaker 1: long time, being cut off from US technology, it's actually
Speaker 1: taking steps to work around that. So obviously there is
Speaker 1: a concern in Washington. There are a lot of Washington
Speaker 1: who are saying, look, we need to get tougher, We
Speaker 1: need to do more and more to really choke off
Speaker 1: China's ability. That just being better than China and technology
Speaker 1: isn't good enough. We have to make sure that we
Speaker 1: freeze China's technology and where multiple generations ahead and as
Speaker 1: while driving this, So how do you think this is
Speaker 1: going to impact the ongoing relationship between the US and
Speaker 1: China as it pertains to chips. Yeah, I mean, we
Speaker 1: haven't seen any reaction from Beijing yet, and I've heard
Speaker 1: people say we're surprised that Beijing has been so restrained
Speaker 1: so far. Fundly, China is the largest market for semiconductors.
Speaker 1: If you're a US company, if you're a European company
Speaker 1: in the industry, you have to be there. You have
Speaker 1: to have those sales revenue to fuel your investing in
Speaker 1: innovation to stay ahead. So it's a it's a very
Speaker 1: difficult situation for Washington to sort of navigate that fine
Speaker 1: line between cutting off China from what it doesn't want
Speaker 1: it to have and also keeping the money flowing and
Speaker 1: keeping US companies having the R and D edge and
Speaker 1: staying on the leading edge in terms of the technical ability.
Speaker 1: All Right, Ian King, who has of course covered the
Speaker 1: chip industry for a couple of decades, and thank you
Speaker 1: um for your expert insights today. Appreciate it. Meantime, Tesla's
Speaker 1: all electric Chuck will roll out before the end of
Speaker 1: the year. In a tweet, Elon Musk said production has
Speaker 1: begun and the first deliveries will had to PepsiCo December one.
Speaker 1: The Big Rig was first unveiled November, but the launch
Speaker 1: delayed many times due to battery cell shortages and a
Speaker 1: decision to focus on consumer models. As we discussed at
Speaker 1: the top of the show, was a brutal day on
Speaker 1: Wall Street after the September jobs report, the NASDAC one
Speaker 1: plunging more than four percent as more severe fed rate
Speaker 1: hikes are priced into the markets. Chip makers got crushed
Speaker 1: after manufacturers warned of an industry wide slowdown and demand.
Speaker 1: I want to bring in Sara const managing director at
Speaker 1: Cleo Capital. So, Sarah, how alarming are these warnings from
Speaker 1: chip makers in your view? I mean, the only chips
Speaker 1: right now, anyone wants our potato, right, Like, this is
Speaker 1: not good for chip makers. Uh, there's twin pressures here, right,
Speaker 1: Certainly the weekend consumer demand for things like PCs, but
Speaker 1: also you know, the increasing restrictions around selling to China
Speaker 1: mean that a massive market is largely off limits. And
Speaker 1: so that's also going to cause problems for the hardware
Speaker 1: companies because you know, they're the ones who aren't buying
Speaker 1: the chips, so they're not selling hardware. And I think
Speaker 1: Apple's you know, lowered forecast for for some of the
Speaker 1: models of its new iPhone is sort of an early
Speaker 1: indicator of the trouble to come. So when you look
Speaker 1: at other areas of technology, you know, their social media,
Speaker 1: there's advertising, their streaming, you know, where do you see
Speaker 1: other potential problem areas everywhere? Uh, you know, I think
Speaker 1: that that it's just gonna be a tough you know quarter.
Speaker 1: I think that that advertising. You know, we're seeing a
Speaker 1: slump based on the waning consumer demand. So you know, Google, Pinterest, Snap, Meta,
Speaker 1: they're all probably going to be in for a tough
Speaker 1: holiday season. And you know, most of the rallies right
Speaker 1: now in tech, they're not based on fundamentals. And and
Speaker 1: the reality is that the fact show a really bleak
Speaker 1: picture for all of these really high price, often unprofitable
Speaker 1: companies that just have flown so high over the last
Speaker 1: few years. And even now when their stock prices are
Speaker 1: coming down, you look at you know, their their pe ratios,
Speaker 1: they're still insane. The you're just still really expensive companies.
Speaker 1: So how much more tech volatility are you preparing for?
Speaker 1: Like a, are you preparing for this downturn to last
Speaker 1: a good long time? Uh, yeah, I am a bear
Speaker 1: preparing for a long cold wind. Her Um. I think
Speaker 1: it's there's just not a lot to be bullish about
Speaker 1: right now in the US, you know, with the FEDS
Speaker 1: very hawkish stance even today about inflation, and you know,
Speaker 1: the right the rate hikes are going to continue until
Speaker 1: the moral improves, and that's probably not till mid delayed
Speaker 1: twenty three, and then globally things are just way worse.
Speaker 1: Right we are the bright spot right now globally. Uh
Speaker 1: you know, the UK is in is in chaos, you know, Russia, China,
Speaker 1: all of the problems that global central banks are having
Speaker 1: because of the US dollar strength right now, there's just
Speaker 1: a lot of problems and I think you have to
Speaker 1: batten down the hatches, you know. I'm a fan of
Speaker 1: selling rallies right now if you can get out with
Speaker 1: a profit on something and and just buying the dips
Speaker 1: really carefully, Like if you're passionate about a core business
Speaker 1: and see a reasonable pe ratio and it's a historic
Speaker 1: low for the company, maybe consider buying. But I'm not
Speaker 1: even looking at like the fifty two week or year
Speaker 1: to date right now numbers. I'm looking at the five
Speaker 1: year charts and saying is this company you know where
Speaker 1: it was before covid or is it still priced way
Speaker 1: higher because of the bumpet got during the pandemic? So
Speaker 1: how is this impacting your strategy and and other venture
Speaker 1: capitalist strategy. I mean we've been talking about all this
Speaker 1: dry powder that's probably stacking up on the sidelines with
Speaker 1: nowhere to go. Yeah, So you know, I think M
Speaker 1: and A is the new I p O for companies.
Speaker 1: I think right now startups are are less focused on
Speaker 1: an I p O. You know, we saw that a
Speaker 1: lot of those tech I p o s aren't working. Um,
Speaker 1: you know posh marks exit from the public markets was
Speaker 1: was a big piece of that. You know, the Peloton
Speaker 1: ceo flat out saying that you know, six more months
Speaker 1: and they're gonna sell out and and you know go private.
Speaker 1: Is it's a good indicator that that's staying public as
Speaker 1: an unprofitable tech company right now is just tough. So
Speaker 1: I think that we're going to see a lot more
Speaker 1: late stage M and A activity and less bell ringing.
Speaker 1: And you know, when it comes to the dry powder,
Speaker 1: vcs have a lot of it, but they're sitting on it.
Speaker 1: You know what I'm hearing from my peers at top
Speaker 1: doctile funds, they're spending more time in Monday meetings triaging
Speaker 1: their current portfolios than they are looking at new deals.
Speaker 1: Then this is in large part because these you know,
Speaker 1: these new deals founders are still asking for prices from
Speaker 1: vcs who are very much in a recession mindset. And
Speaker 1: I think until vcs can get into deals at prices
Speaker 1: that better reflect this moment, a lot of my peers
Speaker 1: are just sitting on the sideline and focusing on following
Speaker 1: on the companies they're already on boards of. We're likely
Speaker 1: to have a tough time in the coming months. So
Speaker 1: talking about light stage M and I gotta ask your
Speaker 1: thoughts on the latest in the elon Musk Twitter saga Twitter,
Speaker 1: you know, holding Musk to the terms of the deal,
Speaker 1: you know, at the price, not accepting anything lower, Musk
Speaker 1: saying okay, I'll go through. I say, you know, what's
Speaker 1: your take on what's happening here, whether or not this
Speaker 1: deal is actually gonna happen. I mean, so many embarrassing
Speaker 1: text messages, just so many, that's Saudie hac level in
Speaker 1: Parrasine tech messages, right, And I think that the whole
Speaker 1: situation is just getting to a point where, you know,
Speaker 1: Ellen's displaying what seems to be a rare moment of
Speaker 1: accepting reality and saying, look, I agreed to buy it,
Speaker 1: so now I'm going to have to buy it, and
Speaker 1: you know, I think that that's the best outcome for shareholders.
Speaker 1: Will that be the best outcome for Twitter users, for
Speaker 1: Twitter employees, I don't know, but at this point it
Speaker 1: looks like that's what's going to happen, all right. Sarah Kunst,
Speaker 1: Managing Director, clayo Capital love having you here, Sarah, Thank
Speaker 1: you so much for joining us on this volatile Friday afternoon. Okay,
Speaker 1: coming up, Disney and DraftKings and Bloomberg report about a
Speaker 1: DraftKings ESPN deal in the works send shares higher. But
Speaker 1: how does the family brand embrace sports gambling? Talk about
Speaker 1: that next? This is Bloomberg. ESPN is nearing a large
Speaker 1: new partnership with sports betting firm Draft Kings, a deal
Speaker 1: which would pave the way for the media giant to
Speaker 1: capitalize on the growing wave of legalized sports betting. Shares
Speaker 1: of DraftKings spike this afternoon on this Bloomberg report. Disney
Speaker 1: already has a stake in draft Kings here to discuss
Speaker 1: our Bloomberg deals, Reporter Crystal Z. So, what do we
Speaker 1: know about this agreement, Crystal? So, so far all we
Speaker 1: know is that there is an intention for a large
Speaker 1: partnership between draft Kings and ESPN, which is owned by Disney.
Speaker 1: But how exactly is this deal going to be structured,
Speaker 1: how is it going to be paid? We so we
Speaker 1: don't have much detail on it. But it would be
Speaker 1: a really really big step for ESPN to really take
Speaker 1: advantage of that, legalizing sports betting in almost half of
Speaker 1: the country now, and it will be a real cultural
Speaker 1: shock for ESPN because Disney has this really wholesome um
Speaker 1: image that they have and getting into sports betting it's
Speaker 1: actually a really really big st Now there's been speculation
Speaker 1: about an acquisition. Is this a step in that direction
Speaker 1: or no? So because of that cultural difference, um, it
Speaker 1: will right now, we're not hearing about outright acquisition. So
Speaker 1: in order to do that, so Drafting here is the
Speaker 1: license holder for sports betting, So if THESPN really want
Speaker 1: to get into it in a really really big way,
Speaker 1: it would make sense for them to buy. And also
Speaker 1: note that Draft Kings stock price of trading around sixteen dollars,
Speaker 1: but it's high. In March last year was around so
Speaker 1: you could say that it's a really really cheap buy.
Speaker 1: But for Disney shareholder to get over that wholesomeness reputation
Speaker 1: of Disney, it will still be a big leap, and
Speaker 1: we're not sure if that's uh, if they're ready to
Speaker 1: make that step. Yes, So actually a lot of analysts
Speaker 1: have dismissed the m and A speculation, but we shall see.
Speaker 1: What about when it comes to, you know, other sports
Speaker 1: scambling platforms More broadly, I feel like I've heard about draft,
Speaker 1: We've heard some draft kings m N a UM specular
Speaker 1: relation for a couple of years. So Draft king is
Speaker 1: in a really really competitive space and they are constantly
Speaker 1: at war with UM places like fanjuel, and they're all
Speaker 1: offering these really really cheap discount or even giving UM
Speaker 1: users free money just to get on their platform. So
Speaker 1: there is a lot of room for consolidation. And with
Speaker 1: this partnership with ESPN, even how it looks like it
Speaker 1: will still be unclear. It could really emerge looking like
Speaker 1: a new platform. It could look like an ESPN platform,
Speaker 1: or it could look like an extra button on the
Speaker 1: existing ESPN app so it could probably look like it
Speaker 1: would look more crowded, um than than less. But you're right,
Speaker 1: like there could be more deals. Draft Kings hasn't been
Speaker 1: public for that long. They only go in public through
Speaker 1: respect a year ish ago, so whether they are ready
Speaker 1: to take on a big deal it's also um waiting
Speaker 1: to be seen. And you know, obviously the stock price
Speaker 1: not doing too well for them to sell equity would
Speaker 1: also be really challenging. So there will be consolidation in
Speaker 1: the space. We just don't know who are buying who
Speaker 1: is selling it. And what's your take on the pace
Speaker 1: of M and A and I p o s through
Speaker 1: the end of the year, given this is your beat
Speaker 1: and we've where you know, we just had a guest
Speaker 1: who said she's bundling up for a long cold winter. Yeah,
Speaker 1: she was just saying, how I M and A is
Speaker 1: a new ip here, right, and that was absolutely true.
Speaker 1: We haven't really seen many many I p o s
Speaker 1: and usually this time post Labor Day pre Thanksgiving has
Speaker 1: historically been the most popular time for I p O
Speaker 1: and we haven't really seen any of them. And um,
Speaker 1: there's always been speculation about you know, there have been
Speaker 1: one or two companies that could still go public this year,
Speaker 1: and it's been quiet, and you know M and A.
Speaker 1: It's also em and is coming back in some way.
Speaker 1: But financing has been extremely challenging. And if you look
Speaker 1: at technology that are growthing, uh and not really generating
Speaker 1: cash flow, those are not things that investors are liking
Speaker 1: right now. So all know, if you're a growth company
Speaker 1: that are looking to I p O or doing M
Speaker 1: and A, it's still a really, really tough environment. So
Speaker 1: um A lot of dealmakers are saying that we should
Speaker 1: probably expect you're making to come back in three even
Speaker 1: the second quarter and even the first quarter, and all
Speaker 1: that would be market dependent obviously, so we will will
Speaker 1: continue to tract to all right, the second quarter of
Speaker 1: we'll looking towards that. Bloomberg's Crystal Z thank you so
Speaker 1: much for staffing by and as we talk about media
Speaker 1: companies looking for ways to cash in as more US
Speaker 1: states legalized sports betting, Bloomberg The lineup with Damien sass
Speaker 1: Hour and Kaylee Lines continues the conversation tonight, seven pm
Speaker 1: New York Time. You don't want to miss it. Welcome
Speaker 1: back to Bloomb're technology and Emily changing in San Francisco.
Speaker 1: Let's get back to the markets and the big story
Speaker 1: of the week, Ellen and his Twitter takeover potentially not
Speaker 1: a done deal yet. Are at Ludlow has been looking
Speaker 1: a little deeper here at what's the latest that we know? Yeah, well,
Speaker 1: Friday was unusual when and so far there was absolutely
Speaker 1: no news about the deal at all, which was a
Speaker 1: massive relief for me and you because we haven't slept
Speaker 1: for four days. But you would look at this monster
Speaker 1: jump in Twitter shares from Tuesday when we had that
Speaker 1: disclosure that Elon Musk had gone back to Twitter and
Speaker 1: back to the original offer fifty tents a share. But
Speaker 1: in the four sessions that have followed, the stock has
Speaker 1: trickled lower again because there are concerns about the financing
Speaker 1: element of this deal, how likely it is to happen.
Speaker 1: And we still continue to look at the spread. Right,
Speaker 1: if we bring up the spread chart, this is the
Speaker 1: gap between that fifty four dollar twenty cents per share
Speaker 1: offer and the current share price, and again it has
Speaker 1: noticeably come down in recent sessions. The latest is, you know,
Speaker 1: m is that Judge Kathleen St. Jude mccormicker of Delaware
Speaker 1: Chancery Court has suspended, paused the trial until October and
Speaker 1: told the two sides that they need to close the
Speaker 1: deal by five pm on October. If they do not,
Speaker 1: then we're heading to trial in November. And the market
Speaker 1: is trying to pass what's actually happening behind the scenes.
Speaker 1: In the broader context of market. It's a really interesting
Speaker 1: stock to watch, is of course, Tesla. Tesla just had
Speaker 1: its worst week since March of March. And it's not
Speaker 1: just the idea that Elon Musk might have to sell
Speaker 1: Tesla shares in order to fund some of the financing
Speaker 1: to buy Twitter, but also this idea that there's key
Speaker 1: man risk that will be distracted if he runs a
Speaker 1: third company on top of Tesla and SpaceX. But the
Speaker 1: gap between the SMP performance and Tesla, it's been a
Speaker 1: real drag on a points basis for that broader index.
Speaker 1: And it's not just, of course, the news cycle. Tesla
Speaker 1: does trade at higher multiple and so is vulnerable to
Speaker 1: the narrative around higher rates. But you know so much
Speaker 1: going on at work here. You and I are not
Speaker 1: going to Delaware on October seventeenth, But on a daily basis,
Speaker 1: we continue to track this deal all right, I'd love
Speaker 1: hope you get some sleep this weekend. Well, you might
Speaker 1: have received an alert from Meta today saying you may
Speaker 1: have logged onto Facebook from a malicious app. What does
Speaker 1: that mean? Well, Matter has reported more than four hundred
Speaker 1: credential theft malware apps to Google and Apple targeting mobile
Speaker 1: users devices to steal their Facebook log and information. The
Speaker 1: apps were disguised as things like photo editors, mobile games,
Speaker 1: health trackers, and they can target more than just Facebook accounts.
Speaker 1: For more on this, metas director of Threat Disruption, David
Speaker 1: Agranovich joins me. Now, David, thank you so much for
Speaker 1: joining us so talk to us about these apps, what happened,
Speaker 1: and how people can protect themselves. Thanks so much for
Speaker 1: having me, Emily, and appreciate the opportunity to talk about
Speaker 1: this report. Today, we released some research into four hundred
Speaker 1: malicious mobile applications. They were designed to steal Facebook log
Speaker 1: and information. And the apps were listed on the Google
Speaker 1: Play Store on Apple's App Store, and they would disguise
Speaker 1: themselves as a variety of different things VPN services, business apps,
Speaker 1: mobile games, different utilities for your phone to try and
Speaker 1: trick people into downloading them. How do you know if
Speaker 1: you've been affected, like, how can you tell? So? Because
Speaker 1: these applications are available on the open Internet, it's no
Speaker 1: single company can protect people alone. We also know that
Speaker 1: these scammers constantly adapt to detection UM by app stores,
Speaker 1: by researchers now here. We reported our findings to Apple
Speaker 1: into Google, and as far as we know, all of
Speaker 1: these applications have been taken down. But we also are
Speaker 1: sending notifications to users on our platform who may have
Speaker 1: been impacted by these applications. UM. Those notifications will include
Speaker 1: some steps that people can take to protect their accounts
Speaker 1: more effectively, as well as some tips for how to
Speaker 1: spot these types of applications elsewhere on the Internet. Why
Speaker 1: are you doing this now? I mean surely this has
Speaker 1: happened before, right, So, our teams have been investigating this
Speaker 1: type of malicious application activity for years. We're always looking
Speaker 1: for malware or other efforts to steal people's credentials. UM,
Speaker 1: but this particular p s A is the first time
Speaker 1: we're releasing one of these kind of public service announcements.
Speaker 1: And the idea is that in addition to working to
Speaker 1: get these apps taken down, providing tools for people to
Speaker 1: identify those apps, we felt it was important for people
Speaker 1: to have tips that they can use both to keep
Speaker 1: themselves safer on our platform and also to stay safe
Speaker 1: across the internet, so that they know what to look
Speaker 1: for if someone is trying to target them with an
Speaker 1: application like this. Now, you also worked at the U. S. Government,
Speaker 1: You led efforts to address foreign interference in democratic systems
Speaker 1: and elections. We've got a midterm election coming up. What
Speaker 1: are you most concerned about and how ready do you
Speaker 1: think META is this time? So whenever there's an election,
Speaker 1: we know we have to stay vigilant. Our teams are
Speaker 1: continuing to monitor for any kind of threats on the
Speaker 1: on our platform, and a good example of this would
Speaker 1: be just last week, we released a report into two
Speaker 1: influence operations, one from Russia one from China, um that
Speaker 1: we caught very early, but in that report we included
Speaker 1: a bunch of information about what they were doing, what
Speaker 1: we had found, who we believe was behind the activity,
Speaker 1: and in that case, like we did with the malicious
Speaker 1: apps investing Asian today, we shared information with our partners
Speaker 1: across the industry, with the U. S. Government, and with
Speaker 1: a public to make sure people knew what to expect
Speaker 1: what we were seeing um I spoke with Francis Hogan
Speaker 1: earlier this week, the Facebook whistle blower, and she raised
Speaker 1: some concerns about safety and security in social media, and
Speaker 1: she used an interesting metaphor, take a listen to this.
Speaker 1: Right now, we can't see behind the curtain of social media.
Speaker 1: We were able to push for safety features and cars
Speaker 1: were found in the partner of transportation, you know, reducing
Speaker 1: the fatality from automobile automobile accents by effectively three and
Speaker 1: a half times because we could actually control cars, you know,
Speaker 1: we can crash test them. Right now, we can't do
Speaker 1: any of those things for social media. We can't crash
Speaker 1: test it, we can't confirm how it could be safer,
Speaker 1: so we don't know what to demand. What do you
Speaker 1: think of her thought there and do you think more
Speaker 1: regulation would help? So I think that the security area
Speaker 1: that my team focuses on is an area where we've
Speaker 1: We've worked very hard to be transparent about our work.
Speaker 1: We've reported on more than a hundred and fifty coordinated
Speaker 1: in authentic behavior influence operations over the last several years
Speaker 1: that originated from more than fifty different countries that operated
Speaker 1: to more than thirty different languages. We've reported on on
Speaker 1: a cyber espionage activity, hacking activity, both related to our
Speaker 1: platform and more broadly across the Internet. I do think
Speaker 1: that there's always more work to be done in the
Speaker 1: security space, but I think that the more important work
Speaker 1: here is that we are sharing information with our industry partners,
Speaker 1: that we're sharing with governments were appropriate, and really importantly,
Speaker 1: that we're sharing with the public, that we're publicizing these reports,
Speaker 1: publicizing our findings, enabling the research into these types of
Speaker 1: behaviors not just on our platform but across the Internet
Speaker 1: in general. There's also some, you know, been some broader
Speaker 1: questions lately about how much Meta is investing in not
Speaker 1: just English language platforms. Obviously, you've got you know, tens
Speaker 1: of thousands of people of people working on trust and
Speaker 1: safety around the world. What can you tell us about
Speaker 1: how much of that investment is focused on on languages
Speaker 1: other than English. So our security work is global. Um
Speaker 1: As I mentioned, we've taken down more than fifty of
Speaker 1: these of these coordinated in authentic behavior operations around the world.
Speaker 1: Those operations operated for more than fifty different countries in
Speaker 1: more than thirty different languages, and so we're making sure
Speaker 1: that We're protecting people on our platform wherever they happen
Speaker 1: to be, from threats wherever they may happen to originate. Again,
Speaker 1: there's always more work to be done here, but by
Speaker 1: focusing on on violating behaviors and threats across the platform,
Speaker 1: we can do our of most to key people safe.
Speaker 1: I know in the security world there's always something keeping
Speaker 1: folks up at night. What's keeping you up at night?
Speaker 1: Right now, we are laser focused on protecting elections around
Speaker 1: the world. Of course, the U S midterms coming up
Speaker 1: pretty soon, the Brazil elections that just happened. Our teams
Speaker 1: are constantly monitoring for security threats related to those elections,
Speaker 1: as well as broader global potential threats. This is probably
Speaker 1: a conversation we can also have after the mid terms
Speaker 1: about what we end up seeing. All right, I would
Speaker 1: like that David Igranovich, met Director of Threat Disruption. Thank
Speaker 1: you for stopping by. All right, Coming up, our next
Speaker 1: guest just raised eleven million dollars despite the worst crypto
Speaker 1: downturn in years. We're gonna talk about growing demand for
Speaker 1: crypto accounting software. Next. This is Gloomberg, So I'm now
Speaker 1: for crypto reporting. Today We're focusing on crypto accounting. After
Speaker 1: tactics eleven million dollar funding around lead by x t
Speaker 1: X Bloomberg, Shonali Bosik is in New York. Sheanale table.
Speaker 1: Thank you so much, Emily. We're going to bring in
Speaker 1: tactic founder and CEO and ask you because it's such
Speaker 1: an interesting thing to see another company raised money in
Speaker 1: this crypto downturn. But with so much volatility and crypto
Speaker 1: mark it's your clients must have a hard time here
Speaker 1: in terms of getting a handle on what it's worth
Speaker 1: and how to account for it. So what is the
Speaker 1: biggest challenge your clients are facing here amid the volatility
Speaker 1: not just among Bitcoin but all sorts of Web three assets.
Speaker 1: I think it's just the fragmentation of activity. We're seeing
Speaker 1: people use different blockchains across different wallets and different currencies,
Speaker 1: and it's just very difficult to get a holistic view
Speaker 1: of the digital asset ecosystem. Well, it's interesting because it's
Speaker 1: not just to your point digital assets. Currencies are also
Speaker 1: fluctuating like crazy. So I mean, how does that kind
Speaker 1: of compound the issues here? Is it harder now to
Speaker 1: account for cryptocurrencies than it had been even a year ago?
Speaker 1: For some reasons. I don't know that it's inherently more difficult.
Speaker 1: I think it's inherently more important though, given the increased
Speaker 1: regulatory scrutiny in the space. Well the regulatory scrutiny also,
Speaker 1: I mean rules have changed, and you've seen other companies
Speaker 1: like micro Strategy really mold to the accounting here of
Speaker 1: crypto when it comes to bitcoin, So how might the
Speaker 1: rules keep on changing That will make it different for
Speaker 1: firms to have to mold to what the regulators ask
Speaker 1: of them. I think what we're seeing actually is a
Speaker 1: lot of activity in tech companies. So venture capital firms
Speaker 1: remain extremely bullish on the potential applications of blockchain technology,
Speaker 1: and that translates to more capital for tech companies. Now
Speaker 1: we're seeing venture capital cool across all sectors and especially
Speaker 1: in the crypto space. But venture firms still have a
Speaker 1: lot of committed capital to deploy. They're definitely slowing the
Speaker 1: pace there, but that means they're looking much more closely
Speaker 1: at financials of crypto companies before they continue to fund them.
Speaker 1: And right now, the landscape is so complicated and fragmented
Speaker 1: that without automation and tools like tactic, it's increasingly difficult
Speaker 1: for these companies to survive. Okay, So that's interesting because
Speaker 1: you yourself obviously just we're kind of in the market
Speaker 1: here when it came to fundraising. What are vcs asking
Speaker 1: firms in the crypto worlds here to get more comfort
Speaker 1: of what's going on there? I think they want to
Speaker 1: a clear review of financials, the same way they would
Speaker 1: for any traditional company. And right now, with a lot
Speaker 1: of that revenue or a lot of that spend is
Speaker 1: coming in the form of a token, it's much more
Speaker 1: difficult to track than it is an ordinary US dollar.
Speaker 1: So if it's in the form of a token, I'm wondering,
Speaker 1: even for yourself, how are you taking money from clients?
Speaker 1: How has your business been impacted in the crypto winter.
Speaker 1: So we actually operate almost entirely in traditional US dollars
Speaker 1: and and continue to use traditional products in that space,
Speaker 1: and that's actually the way the bulk of our clients
Speaker 1: operate for the post part. So we uh, we admittedly
Speaker 1: continue to live in a fiat world. A private company
Speaker 1: is going to pay for their office space to pay
Speaker 1: their employee salaries in US dollars, but token spend and
Speaker 1: various cryptocurrencies are going to be an increasing part of
Speaker 1: their of their balance sheets as digital asset adoption continues. Now,
Speaker 1: when you're looking at crypto, you're talking about tokens. You
Speaker 1: already had kind of mentioned here the difficulties when it
Speaker 1: comes to accounting for them, But what about other assets
Speaker 1: and f t s, other types of Web three assets.
Speaker 1: How do you think about dows in this world when
Speaker 1: it comes to staying accountable to shareholders and regulators. I
Speaker 1: think that's an extremely difficult question right now to answer,
Speaker 1: and it's going to be unfolding in the next several months.
Speaker 1: How we govern something that is theoretically decentralized and isn't
Speaker 1: incorporated the way traditional companies, And you know, it's interesting.
Speaker 1: Another thing that makes this even possible is your work
Speaker 1: with other companies like coin base and custodians like that.
Speaker 1: How much do you see your work growing with custody solutions,
Speaker 1: both on the crypto side, if you will, and the
Speaker 1: traditional finance side. I think custody solutions are going to
Speaker 1: be absolutely crucial here, and that's why we're so excited
Speaker 1: to be backed by FTX as a leader in the space.
Speaker 1: We're back by coin base as well, because we acknowledge
Speaker 1: that there are going to be a lot of players
Speaker 1: in the ecosystem. Even though there's a longer term view
Speaker 1: of a lot of players in the ecosystem, the reality
Speaker 1: is it's a tough market now. And so if that's
Speaker 1: the case, I know you said that you upbridden FIAT,
Speaker 1: but how do you navigate your business through a time
Speaker 1: when clients are also having a time tough time. I
Speaker 1: think we're very lucky to work with people who have
Speaker 1: long term time horizons. So consumer demand has admittedly cooled
Speaker 1: for digital assets like n f T, s UM as
Speaker 1: well as various tokens. Many retail investors who lost money
Speaker 1: or we're definitely staying away from cryptocurrency. However, if you
Speaker 1: look at financial institutions that have much longer time horizons,
Speaker 1: they're thinking five to ten years out. They have not
Speaker 1: abandoned cryptocurrency as an asset class. Well and Joska, thank
Speaker 1: you so much for your time. That is a tactic
Speaker 1: founder and CEO, thank you for walking this through the
Speaker 1: plan here Emily, it's back to you, Shanali, thank you.
Speaker 1: Carmakers and tech companies around the globe are facing the
Speaker 1: prospect of an energy crisis and volatility in chip supply,
Speaker 1: those pressures will continue. According to the Attack and EV
Speaker 1: components Giant Bosh, Stephan her Tongue, the top executive at Bosh,
Speaker 1: Folks with our own blood Low Cridy Gupta and Guy
Speaker 1: Johnson on the European Clothes take a lesson. We're fighting
Speaker 1: against that, that supply shortage. So what we will see
Speaker 1: is even if the demand is slowing, and even if
Speaker 1: some parts of production is probably reallocated, there is still
Speaker 1: an over high demand and that will last four months.
Speaker 1: So even if we see recessive motions in the whole
Speaker 1: entire environment the automotive industry, especially in the car side,
Speaker 1: we remain relatively stable for a certain amount of time.
Speaker 1: Give me some granularity in the supply chain. Where are
Speaker 1: the pain points still present? Where are things improving, and
Speaker 1: especially when we think about energy and input costs, where
Speaker 1: are you still fighting that supply chain inflation. Well, the
Speaker 1: real problem with the supply chain is still with the
Speaker 1: semi conductors, and that is special semi conductors which are
Speaker 1: used for a motive. So these are lots, are large structures.
Speaker 1: We're not talking about this and below, but rather a
Speaker 1: hundred n or ninety or lowest is probably about fourty
Speaker 1: or twenty three for the controllers we use, so that
Speaker 1: still is short. Even if we see that slowing down
Speaker 1: in the mobile phone market which unlocks capacity and semiconductors,
Speaker 1: automotive supply will still be let's say, at least reasonable constraint.
Speaker 1: Even for the next year. There will not be a
Speaker 1: complete free speech, right. There will be always a bit
Speaker 1: of restrainment, So there's always some fight for the components.
Speaker 1: The energy part is definitely also a risk for those
Speaker 1: parts of supply chain which are on the row material
Speaker 1: side energy intensive. So here's for us more supplier question.
Speaker 1: Where we are with our partners in tight control where
Speaker 1: things going. What is unenterpricing, and obviously that makes things
Speaker 1: not cheaper, it makes it more expensive. Well, what do
Speaker 1: you make of the President Biden's big push to create
Speaker 1: some of this manufacturing capacity right here in the United States.
Speaker 1: It's a plan that's going to last at least a
Speaker 1: decade to really get fully operational. What is that something
Speaker 1: at your positioning for or preparing for. Well, that resonates
Speaker 1: very much with us, right because we are if you
Speaker 1: see us very strong in Europe, we're also reasonably strong
Speaker 1: in Asia. But we see ourselves underrepresented here. We are
Speaker 1: here since ninety six. In the North America. We are strong,
Speaker 1: but we should be much stronger. So that resonates very
Speaker 1: well and very happy that this policy comes into place.
Speaker 1: We are expanding, we are growing, We're buying companies, were investing.
Speaker 1: We just announced an investment in Enders and that we
Speaker 1: will announced further investments in our facilities. We invest in Mexico,
Speaker 1: We expand into new companies. We buy like Hydroforce. We
Speaker 1: just bought that, which perfectly fits to us. So definitely,
Speaker 1: the North American space, especially USA, is a big opportunity
Speaker 1: for us. This is the day that we were getting
Speaker 1: news some Tesla on the fact that it's going to
Speaker 1: be producing trucks, and we're starting to see those Tesla
Speaker 1: planning to deliver semi trucks to Pepsi. They unveiled them
Speaker 1: a while ago, but they're now starting to potentially look
Speaker 1: to deliver them. Stephan, do you think that the auto industry,
Speaker 1: the truck industry will broadly though, has been too focused
Speaker 1: on a treat technology Now, it's both right, that's so
Speaker 1: interesting in the automotive and mobility world. Anything is right.
Speaker 1: At the same time, you have to go heavily for
Speaker 1: electrification also, and trucks especially. There are some medium sized trucks,
Speaker 1: so also some heavy trucks if they go in only
Speaker 1: short ranges where you need electrified trucks. Other machinery you
Speaker 1: don't want the electrification because the batteries are just too heavy, right,
Speaker 1: you can't use it. You don't have the electricity infrastructure
Speaker 1: where you have a too long range necessary or you
Speaker 1: drive over the whole day, which also may be a
Speaker 1: problem there. So I would say yes, everything right, we
Speaker 1: just have to see how which technology finds which application,
Speaker 1: and that's what we have the market for. Stephen Hardtungue,
Speaker 1: there Bosh chair of the management board, with our own
Speaker 1: bloodlog I Johnson and critically Dea. And that does it
Speaker 1: for this edition of Bloomberg Technology. You can stay with
Speaker 1: Bloomberg Television tonight. We've got the lineup coming up with
Speaker 1: Damien Sassaur and Kaylee Lines. They talk about how media
Speaker 1: companies are looking to make a profit off the legalization
Speaker 1: of sports betting. Seven p m. Easter and don't forget
Speaker 1: check out our podcast wherever you get your podcasts. I'm
Speaker 1: Emily Changing San Francisco. Have a wonderful weekend. Everyone, this
Speaker 1: Gloomberg